A timber industry analyst explained on Friday that a possibility for Gunns to improve its corporate image following the resignation of its chairman John Gray is very high.

However, several analysts predicted the results of Gunn's share price today may look bleak.

Mr. Gay announced yesterday his departure from the company and its subsidiaries. The 66-year old resigned chairman stayed with Gunns for at least 37 years and was credited for the proposed $2 billion Tamar Valley pump mill.

The company's share price has decreased since it booked a massive decline in its half-year profit. A Sydney analyst explained that big investors are blaming Mr. Gay for the massive fall.

Gunn's shareholders, including Perpetual and Concord Capital, have called on Mr. Gay to depart the company quickly.

"If Mr Gay had stepped down six months ago or even a year ago, a lot of these problems could have been avoided," stock market analyst Peter Warnes explained.

Mr. Warns also added the move for the former chairman to resign is too late to stop the problems facing Gunns, such as large investors selling their shares.

“Market sentiment is very, very hard to recover and we're reeling from a resource super tax, and that won't go away, and neither will the problems with Gunns go away,” he said.

"The sentiment has been badly damaged and the new chairman is going to have a devil's own job of trying to [restore] some shareholder and investor confidence.”

Analyst Robert Eastman of Pulp Mill commented that Mr. Gray's departure will push chief executive Greg L'Estrange to initiate change.

"He would like to be more open and certainly consultative with the community," Mr Eastment said.

Gunn's shares closed yesterday at 27.5 cents, which slightly increased from this week's 10-year low of 26.5 cents.

Financial analyst Mathew Torenius believes that the former chairman's departure will be a minor distraction for shareholders.

Meanwhile, several Tasmanian leaders have praised the outgoing chairman for a job well done.

Premier David Bartlett praised Mr. Gay has made a massive contribution to the state's forest industry.